19.10 After a lively discussion, we had to close as Collier will be teaching several of us in a few minutes on “Sustainability of Growth in Developing Countries“. He wishes us luck with our movement before leaving.
19.08 Collier first of all states that he does not know the new head. He does say however that the G2O was heralded as a “New World”, in which there would no longer be special deals whereby the head of the World Bank is always an American, and the IMF a Frenchman. “The World Bank no longer has an American, but the IMF now has a French woman,” he quips.
19.07 A question for Collier given his background working at the World Bank: what does he think of the recent change of leadership with Jim Yong Kim at its helm?
19.06 “You need a big enough change in the personnel of the party leaderships that they can credibly say ‘this is an old party label, but we disown the past’,” Collier says. He points to the recent failure of political leadership in Italy after its electorate voted for an extremist, comedian Beppe Grillo.
19.05 The solution is for the “old politicians to get out of the way”, says Collier. “But there’s no obvious new proposal,” Dimitris remarks.
19.04 “Institutional change is pretty slow,” Collier says, using the examples of Afghanistan and Iraq. Dimitris interjects: “I hope we are not at that point!”
19.02 Dimitris talks about his home country, Greece, and asks how it can rebuild. What institutions do you start with, especially when moderate politics has been overtaken by extremes?
19.00 Collier discusses the role of the ECB and how it will ultimately write off southern European economies’ debts. He says the paradox of the central bank is that “you can be as bankrupt as you like and still stay in business” – due to the ability of the bank to print its own money.
18.59 A difficulty is that growth is needed to bail countries out, says Collier, but: “The speed with which financial markets force policy change, is faster than the speed at which political markets force policy change. Bondholders have forced a recognition of default, effectively. The debt of insolvent countries has moved into the European Central Bank (ECB).”
18.56 Collier says “Europe’s politicians face the personal costs of changing a policy.”
18.53 Kinga says traditional economic models are faltering, and asks what the effect will be on the developed world?
18.49 Collier says privatising is a “rip-off”, because politically well connected people can steal state assets. It’s better to open it up to competition, he claims.
18.47 Markus asks about the benefits of public assets being privatised when a state is already sizeable.
18.43 Social enterprise works best when it can scale up, Collier argues. The financing needs to scale up, so the ambition can too, he says.
18.40 Ciara asks a question about social entrepreneurship, an area Collier says he has recently taken an interest in.
18.37 Milosz asks more about the autocracy question raised by the Chinese approach and whether it is the way forward for Africa. Collier says it can’t be, because otherwise Africa would be developed.
18.35 International agencies are meanwhile “festooned in careful procedures” such as environmental impact assessments and competitive tendering, which “take years”, Collier adds.
18.33 Collier makes the point that deals are attractive for African leaders, because China builds very fast.
18.32 To explain how he perceives the relationship between China and Africa further, Collier cites the economist Joseph Stiglitz, with whom he used to work. “When the investment banks boom, you ‘find a sucker‘.”
“You hope the sucker says ‘ooh, this is my lucky day. But the sucker mistakes mutual advantage when actually is to their disadvantage.”
Collier says the trouble with the deals struck between Chinese companies and African states is “they are so opaque you just can’t tell”.
18.31 “Mutual advantage unless it’s transparent can shade into Chinese advantage,” warns Collier.
18.30 “What are the pluses to the Chinese approach?” Collier asks rhetorically. “It’s not patronising, and both parties have an incentive to do what is agreed.”
“All business deals are about mutual advantage; that’s how the world is. But it’s the Chinese advantage versus the African advantage,” he says. Collier compares this to a cake being cut, where you only get part of it.
18.28 Collier says the Chinese approach in Africa was learnt by China from what Japan did in China during the 1950s; “it is a Japanese approach rather than a Chinese approach.” Although the approach is termed “mutual benefit”, there are pluses and minuses, he says.
18.26 Milosz poses a question about Chinese involvement in Africa, and asks whether we need to consider a Beijing Consensus rather than a Washington Consensus.
18.25 “We are in the midst of not just political change, but social change, which is very new,” Collier says. “It has not been internalised in the policy sphere… but it’s an exciting agenda,” he adds.
18.24 Collier informs us he persuaded the UK’s Department for International Development to pull out of giving aid to India, because it is already a large and growing country.
18.23 Responding to the first question from Victoria about the current approach to development, and whether it works, Collier says: “The approach to development is under rapid rethinking, and needs to be in several respects. The problem of development is getting much smaller, most countries are now rapidly catching up. We need to focus on countries that are not catching up.”
18.22 Collier tells us he likes the ECON+ initiative, particularly that is international, and he is encouraging his son to get involved in these types of movements.
18.18 Everyone seems to have made it. Victoria is introducing Collier to everybody, and the students will introduce themselves afterwards before we take questions.
18.06 We’ve been informed that we need to switch rooms and so will be back soon.
18.00 Good evening and welcome to the first ECON+ roundtable with Paul Collier. We are waiting for Paul’s arrival, as he is unfortunately stuck outside Sciences Po. A student protest is underway against the electoral process for management of the school, and access to the building has been blocked.
Today ECON+ is pleased to announce a round table discussion with Paul Collier. We will be tweeting and live blogging for those who are interested. @ECONPlusNetwork and live blog will be here.
Paul Collier is currently the Director of the Centre for the Study of African Economies, Professor of Economics and Public Policy at the Blavatnik School of Government and Professorial Fellow of St. Antony’s College. These are all part of the University of Oxford Additionally, he is a visiting professor at Sciences Po Paris, Paris 1, and CERDI (Centre d’Études et de Recherches sur le Développement International, located at Université d’Auverge).
From 1998-2003, Collier worked at the World Bank, acting as Director of the Research Development Department. Here, he published numerous influential papers such as “Aid allocation and poverty reduction” (with David Dollar, 2002), “Can the World Cut Poverty in Half? How Policy Reform and Effective Aid Can Meet International Development Goals” (2002, with David Dollar), “Aid, policy and growth in post-conflict societies” (2004, with Anke Hoeffler), “Greed and grievance in civil war” (2004, with Anke Hoeffler).
He is also author of The Bottom Billion, (2007), Wars, Guns and Votes: Democracy in Dangerous Places and The Plundered Planet (2010).
His areas of activity are
- Governance in low-income countries, especially the political economy of democracy;
- Economic growth in Africa;
- Economics of civil war;
- Globalisation; and